Here are a few of the questionable aspects relating to the e-tolling system. This is additional to my previous thread – 50 Reasons to avoid the e-toll system.
It is a long post, but worth it if you want to be informed about the corruption and lies...
But there is another juicy bit of corruption or lies that I just came across:The initial tender for the contract was only worth R1.1bn. Only after Kapsch won it, was it significantly increased to the exorbitant amount we sit with today for half of the project's distance to be covered. So the price was increased by 1000% for doing half the work.
Kapsch recently won a contract in Belarus to implement e-tolling on all of their category 1 roads. However they are doing so in conjunction with another contract to build secondary ring-roads as alternatives. Guess how much this contract is costing Belarus? EUR267m. And that is for all of Belarus' category 1 roads - not just for one province. That is for the entire country.
India just raised a bond of $4bn to upgrade all of its category 1 roads around the country, while also introducing e-tolling. That is the same amount that we paid for Gauteng alone. India is doing this for its entire national freeway system - construction and e-tolling.
In France, a similar system of e-tolling was launched 2 years ago and cost just EUR10m - they managed it themselves and in the process created a huge number of jobs. They merely purchase all of the hardware from Kapsch.
In Portugal, they have done the same as in SA. They have won a significant contract but refuse to divulge the value. Although the project is for 520km of road, estimates have placed the figure at below the EUR1bn mark. Again, a far cry from what we paid. So why on earth have we paid such a massive premium (in excess of 400% in some cases)?
It seems quite clear-cut to me - someone is making a tidy profit out of this deal, on top of the company's margins. Their ties with SAAB are just far too convenient to ignore...
Now for the really juicy bit that could really help the legal case against e-tolling.
The state keep touting a figure of R20bn in bonds that would need to be repaid should they trigger a default by not implementing the e-tolls. However our actual liability should be less than half of that, considering that less than half of the planned e-tolling has been constructed. Remember that they halted all new construction of e-toll roads and we now sit with about 100-odd kilometres as opposed to about 300 to 400 (I can't find the actual figure). The other issue I have is that their bond programme has been fully subscribed at R30bn - not R20bn which they keep blurping on about.
So either our liability should only be around R5bn to R10bn which can be recovered fairly easily or they have squandered close on R20bn of the money...
Firstly, let's look at the costs, broken down by none other than Sbu Ndebele himself:
Taken from this article - http://itweb.mobi/home/item_id-47646/
Which gets really interesting for a number of reasons. Let's look at what Sbu Ndebele has to say:
Aha, so the user-pays principle is nonsense then, Sbu? Thanks for clarifying that one.The cost of the e-tolling system is not only applicable to Gauteng, but is potentially applicable to the national road network, says transport minister Sibusiso Ndebele.
Now let's move on to the article:
So Sbu told parliament, under oath, that the e-toll system will only cost R2.6bn? We now know that the majority of the costs went into implementing the e-toll system. That is a massive lie.Media reports this week alleged the open road tolling system in Gauteng will exceed the Gautrain's R30 billion in costs by R5 billion.
In response to a parliamentary question last week, transport minister Sibusiso Ndebele broke down the costs of road construction for each specified phase of the GFIP and the construction cost of the e-toll collection system.
The cost of the GFIP phases, including contract price adjustment (CPA) and VAT, is R17.8 billion, according to the figures in the parliamentary response.
However, publications have reported the figure as R19.8 billion and thus declared an increase of R2 billion on the figure of R17.5 billion that was previously given by government.
Alex van Niekerk, GFIP senior project manager at Sanral, told ITWeb that the estimated cost of the toll operations until 2020 is R12.5 billion.
According to Ndebele's figures in the parliamentary response, the e-toll system construction costs amount to R2.6 billion. This figure added to the road construction cost of R19.8 billion and the toll operating cost, gives a round figure of R35 billion.
Even if the figure of R19.8 billion was correct, the GFIP and e-toll system costs still do not exceed that of the Gautrain, notes Van Niekerk.
“That's not comparing apples with apples. They need to take the capital cost plus the operational cost plus the VAT plus the financing cost of the Gautrain, as well as inflation, to be able to compare the two.”
Sbu also tells us that the project will only cost R17.8bn, however we know that to be absolutely ridiculous and a complete lie. We know this because a much larger bond was raised to finance the project and as it turns out, the reports of R35bn were not far off at all.
So what we now know is that both Van Niekerk and Ndebele were lying, because the tolls did cost far more than R17.8bn and the e-toll tariffs have gone up, considerably.However, Van Niekerk says these calculations cannot be simplified. “It's extremely complicated contractual matters that need to be understood. I'm just worried that it's a VAT matter.”
He explains that the contractor accommodated for inflation on the 10-year contract period.
“It's the impact of construction inflation. It's the standard practice worldwide. If you apply the current inflation rate, the figure drops by a couple of billion so it's an estimated figure.”
He adds that if the costs were in fact escalating, the e-toll tariffs would have been increased but that is not being done.
Ndebele explained that the determination of toll tariffs is based on a number of factors, including the project's capital costs and associated debt servicing; routine road maintenance costs for the tolled road sections; future periodic maintenance action requirements, such as pavement rehabilitation and overlays; toll operational costs and other costs associated with incident management; and the provision of intelligent transport systems.
There are 19 construction projects that were awarded for the upgrading of the freeways, according to Ndebele.
“These are, what is generally known as a rate and measurement contract. The tendered amounts for the construction of the works, showing the scheduled works, provision for price adjustment in accordance with the standard industry formula, known as the CPA and VAT are shown in the table.”
The minister also noted that the toll construction costs include the incident management systems, central operations centre, transaction clearing house, and violation processing centre.
“Furthermore, it is noted that the costs of the ORT [open road tolling] system and COC are not only applicable to the GFIP, but are potentially applicable to the national road network since it fulfils a national function.”
We also now know that the operational cost of e-tolling far outweighs all other costs, therefore we can very easily show that very little importance has been placed on issues like safety and maintenance, as put forward by Sbu.
We also see Sbu reiterating that Gauteng e-toll roads are of a national benefit. Therefore we can conclude that the user-pays principle is not only unfair in tax-payers' eyes but in our transport minister's too...
Absolutely. What is evident is that in all other countries where e-tolling exists, alternative roads are built or public transport is quite developed. We have neither in South Africa. We are just expected to cough up for the sake of it.“The billions that are wasted on these tolls could be utilised to build an integrated, safe, reliable and affordable public transport system for everyone, particularly the poor.”
It is fantastic to see South Africans taking a united stand against this project's implementation. Do not let your guard down now. It is only by fighting this tooth and nail that more of this sort of evidence can be uncovered and investigated. The moment that you let in is the moment that we brush this off our shoulders as our responsibility and apathy takes over once again. Apathy does not breed results...